10:45 AM EDT, 08/14/2024 (MT Newswires) -- Home Depot's ( HD ) fiscal Q2 results suggest that the home improvement industry's recovery may take longer and could be "shallower than hoped," Morgan Stanley said in a note e-mailed Wednesday.

On Tuesday, the home improvement retailer cut its full-year earnings and comparable sales guidance due to macroeconomic headwinds, even as the company reported better-than-expected fiscal Q2 financial results.

"While this was mostly expected heading into HD's Q2'24 release, the backdrop is marginally worse and expectations for a bounce back get pushed out even further, probably to mid-2025," Morgan Stanley said

Home Depot ( HD ) remains one of the firm's preferred cyclical recovery names, however, the analysts added.

Morgan Stanley has an overweight rating and a $380 price target on the company's stock.

Home Depot ( HD ) shares were up 1.5% in recent trading.

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